On February 22, the NLRB (National Labor Relations Board) ruled that severance agreements preventing laid-off employees from making publicly disparaging statements about their employer are generally illegal. The NLRB also ruled that severance agreements may not include blanket confidentiality provisions that prevent employees from speaking with anyone else about the terms of the agreement. The ruling overturns a 2020 decision by the then Republican-controlled board that found such agreements were not illegal on their face.
The NLRB is a federal agency tasked with safeguarding employees’ rights and preventing unfair labor practices. The Board’s five members are appointed by the President. During President Biden’s administration, the Democratic-controlled Board’s rulings have largely been worker- and union-friendly.
Wednesday’s ruling is important because it reinstates what until 2020 had been a “longstanding precedent” preventing corporations from asking laid-off employees to waive rights under the National Labor Relations Act in order to receive severance. Under the Board’s recent ruling, employers may no longer withhold severance to silence employees and prevent them from publicly discussing abuses at the workplace, including sexual harassment and assault. Severance agreement clauses preventing employees from discussing workplace misconduct are frequently referred to as “gag” clauses.
Lauren Teukolsky has reviewed severance agreements and fought for workers’ rights for over 20 years. If you believe you have received an illegal severance agreement, click here to get in touch with our office.
Lauren Teukolsky is the founder and owner of Teukolsky Law, A Professional Corporation.